Domestic stent makers gain on the back of price caps

This year, domestic stent firms are aiming for 60 per cent of the market estimated to be Rs 1,200 crore now due to a drop in the average prices of the stents, Rajiv Nath, AiMeD told ET.Prabha Raghavan | ET Bureau | September 15, 2017, 04:39 IST

NEW DELHI: Domestic stent makers are looking to capture a greater share of India’s coronary stent market on the back of an uptick in sales after the government slashed prices of the devices by over 80 per cent. While some multinational firms have claimed the move has made it unviable to supply their “latest generation” models in the country, their local competitors claim to have come out as the winners in this situation.

“In the last six months, we have seen a positive trend towards increased sales for domestic manufacturers. This is more so in Tier II & Tier III towns due to higher affordable access post reduction of prices,” said Rajiv Nath, Forum Coordinator, Association of Indian Medical Device Industry (AiMeD). A firm is a lobby group for domestic medical device makers, including major Indian stent firms like Sahajanand Medical Technologies (SMT), Translumina Therapeutics and Meril Life Sciences that together were estimated to capture around 30 per cent of the country's Rs 1,500-crore stent market last year.

This year, domestic stent firms are aiming for 60 per cent of the market estimated to be Rs 1,200 crore now due to a drop in the average prices of the stents, Nath told ET.

While AiMeD declined to disclose how much sales in these regions have grown, two industry executives ET spoke to claim this growth has been between 30-50 per cent.

This year, SMT, Translumina and Meril are expected to have grown their market share to together capture around 35 per cent, according to one of the executives. “Some of this growth has also been due to confusion and panic created after the multinational companies tried to withdraw their newer stents from India,” said the person, who requested not to be named.

At the same time, it is not clear how the price caps have affected the volumes of sales of multinational firms like Abbott, Medtronic and Boston Scientific which together held over 60 per cent of the total stent market last year.

“At this point in time, it would be premature to comment on this as we don’t have substantiating data to prove how the volumes and revenues have been affected. We will only know for sure once the NIC (National Intervention Council) data comes next April,” an executive of a global stent firm told ET on condition of anonymity.

Indian stent maker SMT is expected to experience twice the growth in sales this year compared to last year, according to the firm’s CEO, Ganesh Sabat. The firm has managed to capture 15-16 per cent of the total stent market now from 12 per cent last year, he said.

“For the last four years, we would experience 40 per cent growth in sales every year. This year, we have made that growth in the last six months alone,” he told ET.

SMT provides its stents to around 70 per cent of the over 1,000 cath labs in India, Sabat added. “We’ve seen growth more or less everywhere, uniformly.”

Translumina has seen over 50 per cent growth in the number of stents it has deployed between January to September this year over the same period last year, said an industry executive who spoke to ET on condition of anonymity.

The firm has seen an increase in revenue of around 20-25 per cent during the same period and its market share has grown to close to around 15 per cent now from 12 per cent last year, the person said.

In February, the National Pharmaceutical Pricing Authority (NPPA) clubbed all models of drug-eluting and biodegradable stents marketed in India and capped them at the same ceiling price—Rs29,600, excluding taxes.

The move was not received well by global stent firms, with bodies like the Medical Technology Association of India (MTaI) and AdvaMed arguing it would dissuade firms from launching innovative products in this space due to lack of price differentiation.

Shortly after, Abbott, Medtronic and Boston Scientific approached the regulator with applications to withdraw their latest launches from the market.

Abbott had said then that the price caps had made it unviable for the company to sell its newest stents in the country because the costs outweighed the prices it could charge for the products.

Recently, the firm also approached NPPA to withdraw two of its stent brands—bioresorbable ‘Absorb’ and metallic drug-eluting ‘Xience Alpine’.

A global stent firm’s executive had earlier told ET that import costs for some multinational stent brands are now higher than their ceiling price.